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XPO investors to vote on exec pay

XPO investors to vote on exec pay

LOS ANGELES, May 16: XPO Logistics Inc investors are set to vote on executive compensation, board oversight and sexual harassment prevention policies on Wednesday after a tough eight months for the warehousing and delivery company in which its shares have halved in value, reports Reuters. The Connecticut-based company has twice lowered its 2019 profit forecast as it struggles to replace lost revenue, and is trying to contain investor concern over costly executive compensation. It is also managing the fallout from media reports about its alleged mistreatment of workers, including sexual harassment and discrimination against pregnant employees. XPO has said it reviewed the allegations and found them to be unsubstantiated and untrue. Its shares closed on Tuesday at $57.80, about half the all-time high of $116.26 hit in September. Investors will decide whether to ratify compensation for named executives under non-binding “say on pay” rules. XPO has recommended doing so, but shareholder advisory firms Institutional Shareholder Services (ISS) and Glass Lewis have recommended a vote against ratification. Chairman and Chief Executive Bradley Jacobs’ total compensation was $13.3 million in 2018, $1.4 million in 2017 and almost $22 million in 2016. He received a large equity grant while a previous award was still vesting, ISS wrote in a report. “Given that the company granted the most recent award more than a year before the vesting period for the prior grant was over, investors may question the lack of a firm commitment not to make additional rewards,” ISS said. ISS and Glass Lewis also went against XPO with recommendations that shareholders back an International Brotherhood of Teamsters’ proposal that would require the board chairman be an independent director. XPO said its governance structure ensures independent management oversight and that shareholders’ interests are best served by having Jacobs as chairman and CEO. The company is looking to replace $600 million in lost revenue from its top customer, identified by current and former XPO employees as Amazon.com Inc. That customer moved two-thirds of the business it had with XPO in-house, XPO said. Hedge fund Spruce Point Capital Management, which has taken a short position in XPO, in December accused the company of hiding losses through aggressive accounting and criticized its use of acquisitions for growth. XPO called the Spruce Point report “intentionally misleading, with significant inaccuracies.” ISS and Glass Lewis are split on a resolution from the Service Employees International Union Pension Plans Master Trust, which calls for the board to strengthen XPO’s workplace sexual harassment prevention efforts and report to shareholders on actions taken. XPO called the proposal “unnecessary,” saying that existing policies and procedures already provide a framework for preventing workplace harassment. Shaanxi is the latest province to join a land-sea trade corridor that facilitates commerce between western Chinese provinces and other countries and regions. The New International Land-Sea Trade Corridor is a trade and logistics passage jointly built by western Chinese provincial regions and Singapore under the framework of the China-Singapore (Chongqing) Demonstration Initiative on Strategic Connectivity. Chongqing is a center of operation for the corridor. Goods are transported to the Beibu Gulf in Guangxi Zhuang Autonomous Region and transferred to sea routes. The corridor offers an alternative for western Chinese provinces and autonomous regions other than shipping goods from the east coast. Shaanxi, the starting point of the ancient Silk Road, became the ninth province to sign on to the corridor after Chongqing, Guangxi, Guizhou, Gansu, Qinghai, Xinjiang Uygur Autonomous Region, Yunnan, and Ningxia Hui Autonomous Region. The provinces and autonomous regions are expected to improve logistics infrastructure, boost commercial relations and exchange of information, and innovate in policy-making, said Han Baochang, director general of the China-Singapore (Chongqing) Demonstration Initiative on Strategic Connectivity Administrative Bureau. By the end of March, freight trains on the routes had made 901 trips, covering 166 ports in 71 countries and regions.

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